“Buying property can be one of the most rewarding investments, but it also comes with risks. For many, the fear of making a bad real estate deal looms large, potentially costing hundreds of thousands, if not more.
“Whether you are an experienced investor or new to the real estate market, knowing how to avoid costly mistakes is crucial.”
Those were the words of the President, African Real Estate Society (AFRES), Mr. Kunle Awolaja, while providing guide and proven strategies to help people steer clear of bad deals and ensure that money is well spent.
The proving strategies are:
1. Perform thorough due diligence:
One of the biggest mistakes in real estate is jumping into a deal without fully understanding the property and its market. Always investigate the property’s history, including past sales, legal issues, and any liens to ensure the property aligns with your goals.
2. Know the market:
The real estate market is dynamic, and making money in real estate often comes down to timing. Buying during a market upswing or downswing can greatly affect your return on investment. Make sure you are aware of the local and national market conditions before purchasing. Is it a buyer’s market or a seller’s market? These factors can either make or break your investment.
3. Work with experienced professionals:
Having an expert in your corner can mean the difference between a great deal and a disaster. From real estate agents to legal advisors, working with seasoned professionals ensures that all potential red flags are addressed. An experienced real estate agent will know the ins and outs of the market, a lawyer will safeguard you from legal pitfalls, and a property manager can help with your investment strategy.
4. Get an accurate property valuation:
Overpaying for a property is one of the fastest ways to lose money. Before finalizing a deal, ensure you get a reliable and professional property appraisal. Beyond just the sale price, consider hidden costs like repairs, renovation needs, and future maintenance. A comprehensive valuation gives you a clear picture, of the total investment you’re making, allowing you to negotiate better and avoid surprises.
5. Always have an exit strategy:
Whether you are buying to rent, flip, or hold onto the property for appreciation, having a clear exit strategy is crucial. Think ahead: how long do you plan to own the property, and how will you sell it if things don’t go according to plan? A well-thought-out exit strategy can prevent financial strain down the road and ensure that your investment doesn’t turn into a financial burden.
Awolaja pointed out that real estate remained a powerful investment tool, but to avoid losses, one would need to be informed, strategic, and proactive.
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